The Washington, DC metro area presents a unique opportunity for commercial real estate. With evolving workplace patterns, repositioning underutilized office spaces has become increasingly attractive for private developers. But in a competitive market where tenant retention equals steady revenue, how do you transform your property while keeping current tenants operational and satisfied?
The Developer’s Challenge
For firms operating in the DC metro area, several market-specific factors shape building repositioning strategies:
- Premium tenant expectations in a market accustomed to Class A amenities
- Complex regulatory landscape spanning multiple jurisdictions in DC, Maryland, and Virginia (DMV)
- Historic considerations in many prime development corridors
- Strong competition for retaining top-tier commercial tenants
- High-profile tenants with specific security and operational requirements
The DC metro’s diverse tenant ecosystem requires nuanced approaches. On one floor, you may have professional services firms with client-facing office requirements. In contrast, you may have a federal contractor with strict security protocols and SCIF requirements on another floor. Meanwhile, your retail tenants may require consistent customer access on the ground floor. Building repositioning isn’t just about physical transformation—it’s about maintaining the tenant relationships you’ve spent years cultivating. Collaborating with your construction manager on complex phasing strategies will help to ensure those relationships continue to thrive.
Building Repositioning Strategies for DC Metro Area Properties
A successful DC-area building repositioning typically employs one or more of these strategies:
Installing High-End Finishes
This approach works particularly well for older buildings targeting new tenants. Gilbane’s recent three-level office renovation for Ponte Gadea, a Spanish real estate group, successfully transformed the lobby of 1445 New York Avenue by installing a high-end, interconnecting curved glass staircase from the lobby to the second floor.
Our success hinged on maintaining access to the main elevators, conducting constructability reviews to ensure the successful installation of the curved glass and millwork staircase, and engaging in proactive material procurement.
Complex Phasing and Coordinated Relocations
For properties maintaining retail tenant operations, complex phasing supports the relocation of building tenants while existing spaces are converted into new uses.
We used this approach at The Row on 19th to successfully connect the ground floor of three separate buildings into a seamless lobby and amenity space for tenants. We relocated a salon in the planned work area to a new location adjacent to the building so it could remain open throughout construction. Our approach included constant communication with building management and the salon and adjusted phasing plans, such as off-hours work, so they could remain open. We worked daily with the salon owner to provide cleaning and new protection as needed.
Tenants expect zero disruption to their day-to-day operations. Just as we did at the Row on 19th, common areas should never feel like they’re ‘under construction’. To maintain the Class A experience throughout your building repositioning, employ these strategies to mitigate disruption:
- Enhanced sound attenuation that exceeds basic requirements
- Aesthetically pleasing temporary partitions and increased cleanliness standards that maintain the Class A feel
- Alternate paths and spaces that don’t compromise the tenant experience
- Communicate regular construction updates that ensure tenants can plan around shutdowns and noise disruptions.
Navigating various jurisdictions and project types
A key challenge for developers with regional portfolios involves navigating different regulatory environments. Successful project teams include experts who can navigate these varying requirements and permitting nuances, particularly for portfolios spanning multiple locations within the metro area. At 1899 Pennsylvania Avenue, the exterior of the building was updated with new glass curtainwall, waterproofing, and pavers to improve the curb appeal. Exterior work like this requires another level of coordination. Gilbane worked with the city to coordinate site work permits and constantly reworked protective measures to ensure the public had access to various sidewalk areas along the building’s busy northwest DC corner. On projects like this, Gilbane has used Washington, DC’s Accelerated Plan Review (APR) program, which should be considered to avoid potential permit and schedule delays.
Planning for Success: Takeaways for Your Next Building Repositioning
If you’re contemplating a tenant-occupied repositioning project in the DMV, these principles will guide success:
- Understand your specific tenant businesses and build phasing plans around their operational needs
- Consider the federal factor in security and scheduling decisions
- Navigate jurisdictional requirements proactively with specialized expertise
- Maintain premium common areas and amenity experiences throughout construction
- Communicate early and often to help mitigate disruption
The Bottom Line
The Washington, DC region offers substantial opportunities for office repositioning, but success requires a tenant-centric approach that respects the unique dynamics of this market. With strategic phasing, sophisticated communication, and construction management that prioritizes the tenant experience, developers can transform properties while maintaining valuable tenant relationships.
From Downtown DC to Tysons Corner, from Bethesda to Alexandria, the most successful projects recognize that tenant satisfaction during construction translates directly to the bottom line through both retained revenue and enhanced reputation.
